Cuba could beat US energy blockade with $8bn investment in renewables, says thinktank

Report by Common Wealth argues rest of the world should pay for country’s transition as reparative climate finance

Cuba could beat the US’s crippling energy blockade for ever with just an $8bn investment in renewable energy. And the rest of the world should pay for it.

Those are the bold claims of a thinktank analysis of the embattled socialist republic’s energy policy, which claims that Cuba could show its Caribbean neighbours the way to a green energy future.

Just $8bn (£5.9bn) could fund the buildout of enough renewable energy to cover 93.4% of Cuba’s electricity generation needs, the report claims. For less than $20bn, Cuba could become the first country in the Caribbean to have a grid powered entirely by renewables.

The proposals come as Cuba endures weeks of an energy blockade imposed by the US on the island and its communist-run government, which Washington claims has a “malign influence” on the region.

Since January, Cuba has received just one shipment of oil, from Russia, after Donald Trump signed an executive order threatening trade tariffs on any country that sold oil to the island nation.

By March, its national electric grid had collapsed, with its 10 million people enduring repeated blackouts. Hospital intensive care units lost power, and transport and industry ground to a halt, as Trump boasted: “I do believe I’ll be … having the honour of taking Cuba.”

Analysis by the Common Wealth thinktank’s Transition Security Project (TSP) outlines how Cuba could gain complete energy independence from its volatile neighbour by transforming its grid to run from renewable energy, which would not only eliminate its vulnerability but also serve as a model for the region.

“The US’s energy dominance strategy seeks to entrench dependence on fossil fuels, stall the green transition and strengthen US power,” said Kevin Cashman, a researcher with TSP, who wrote the analysis. But increasingly cheap and scalable solar power and battery storage weaken such a strategy.

“For countries like Cuba – with enormous renewable potential, but suffering blackouts and widespread suffering under a cruel and illegal US-imposed energy blockade – a transition to green electricity would reduce US leverage and provide a shining example to the world.”

Modelling four different scenarios, the TSP analysis found that a fully renewable grid for Cuba would cost $19.2bn, but an $8bn investment would be sufficient to end the country’s reliance on imported fossil fuels. Even a $5bn rollout would reduce Cuba’s reliance on fossil fuels to just a fifth of electricity generation.

Under the most ambitious proposal, three-quarters of electricity generation would be provided by solar, with a fifth coming from wind and the remainder provided by hydropower and bioenergy. Cheaper scenarios would have greater reliance on bioenergy and wind.

“Electricity is cheaper in every renewable investment scenario than in business as usual: the cost per unit of energy falls from 14.3¢ per kWh in the baseline scenario to 12.1¢ with $1bn of investment, 7.3¢ with $5bn, 6.5¢ with $8bn, and 9.9¢ in the fully renewable case,” the report said.

The transition would require a society-wide transformation, but Cuba has managed that before: after the collapse of the Soviet Union in the 90s, the country rapidly transformed its agricultural system towards agroecology and self-sufficiency.

In the past year, the Cuban government has already brought more than 1,000MW of solar online with Chinese financing and assistance.

Which leaves the question: who would pay? “Financing this transition should … be understood as reparative climate finance,” the report argues. Not only would Cubans be able to pay back investments through savings on cheaper energy, but the transformation “would set an important example of a rapid energy transition under conditions of external constraint”.

Source: The Guardian